20191203notice_of_application_order_no_34496.pdf

Office of Secretary
Service Date
December 3,2019
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF ROCKY MOUNTAIN )CASE NO.PAC-E-19-18
POWER'S APPLICATION TO UPDATE )THE LOAD AND GAS FORECASTS USED )NOTICE OF APPLICATION
IN ITS INTEGRATED RESOURCE PLAN )AVOIDED COST MODEL )NOTICE OF
)MODIFIED PROCEDURE
)ORDER NO.34496
On November 7,2019,Rocky Mountain Power ("Company"),a division of PacifiCorp,
applied to the Commission to update its load forecast,natural gas forecast,and contract
information components of the incremental cost Integrated Resource Plan ("IRP")avoided cost
methodology for qualifying facilities ("QF")under the Public Utility Regulatory Policies Act of
1978 ("PURPA").Application at 1.The Company indicates that the filing complies with
Commission Order Nos.32697 and 32802.Id.The Company asked the Commission to issue an
order approving the updated information for inclusion in the Company's IRP avoided cost
calculations with an October 15,2019 effective date.
The Commission now issues this notice of the Company's Application and Notice of
Modified Procedure,setting public and Company reply comment deadlines.
BACKGROUND
Under PURPA,electric utilities must purchase electric energy from QFs at rates approved
by the applicable state agency-in Idaho,this Commission.16 U.S.C.§824a-3;Idaho Power Co.
v.Idaho PUC,155 Idaho 780,780,316 P.3d 1278,1287 (2013).The purchase or "avoided cost"
rate shall not exceed the "'incremental cost'to the purchasing utility of power which,but for the
purchase of power from the QF,such utility would either generate itself or purchase from another
source."Order No.32697 at 7,citing Rosebud Enterprises v.Idaho PUC,128 Idaho 624,917 P.2d
781 (1996);18 C.F.R.§292.101(b)(6)(defining "avoided cost").
The Commission has established two methods of calculating avoided cost,depending on
the size of the QF project:(1)the surrogate avoided resource ("SAR")method,and (2)the IRP
NOTICE OF APPLICATION
NOTICE OF MODIFIED PROCEDURE
ORDER NO.34496 1
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF ROCKY MOUNTAIN )CASE NO.PAC-E-19-18
POWER'S APPLICATION TO UPDATE )
THE LOAD AND GAS FORECASTS USED )NOTICE OF APPLICATION
IN ITS INTEGRATED RESOURCE PLAN )
AVOIDED COST MODEL )NOTICE OF
)MODIFIED PROCEDURE
)ORDER NO.34496
On November 7,2019,Rocky Mountain Power ("Company"),a division of PacifiCorp,
applied to the Commission to update its load forecast,natural gas forecast,and contract
information components of the incremental cost Integrated Resource Plan ("IRP")avoided cost
methodology for qualifying facilities ("QF")under the Public Utility Regulatory Policies Act of
1978 ("PURPA").Application at 1.The Company indicates that the filing complies with
Commission Order Nos.32697 and 32802.Id.The Company asked the Commission to issue an
order approving the updated information for inclusion in the Company's IRP avoided cost
calculations with an October 15,2019 effective date.
The Commission now issues this notice of the Company's Application and Notice of
Modified Procedure,setting public and Company reply comment deadlines.
BACKGROUND
Under PURPA,electric utilities must purchase electric energy from QFs at rates approved
by the applicable state agency-inIdaho,this Commission.16 U.S.C.§824a-3;Idaho Power Co.
v.Idaho PUC,155 Idaho 780,780,316 P.3d 1278,1287 (2013).The purchase or "avoided cost"
rate shall not exceed the "'incremental cost'to the purchasing utility of power which,but for the
purchase of power from the QF,such utility would either generate itself or purchase from another
source."Order No.32697 at 7,citing Rosebud Enterprises v.Idaho PUC,128 Idaho 624,917 P.2d
781 (1996);18 C.F.R.§292.101(b)(6)(defining "avoided cost").
The Commission has established two methods of calculating avoided cost,depending on
the size of the QF project:(1)the surrogate avoided resource ("SAR")method,and (2)the IRP
method.See Order No.32697 at 7-8.The Commission uses the SAR method to establish what are
commonlyreferred to as "published"avoided cost rates.Id.Published rates are available for wind
NOTICE OF APPLICATION
NOTICE OF MODIFIED PROCEDURE
ORDER NO.34496 1
and solar QFs!with a design capacity of up to 100 kilowatts ("kW"),and for QFs of all other
resource types with a design capacity of up to 10 average megawatts ("aMW").On the other hand,
if a QF's design capacity is above the published rate eligibilitycaps,the utility must use the IRP
method to negotiate a project-specific avoided cost rate with the QF.Id.at 2;Order No.32176.
The IRP method accounts for "many different variables and produces a[n avoided cost]result
based on each individual utility's need for energy."Order No.32697 at 17.The IRP method's
variables are at issue here.
Regarding the IRP method,the Commission requires utilities to update fuel price forecasts
and load forecasts each year on October 15.Order No.32802 at 3.All other IRP method variables
and assumptions remain fixed between the Company's biennial IRP filings.Order No.32697 at
22.The Commission expects the utility's load and resource balance to account for long-term
contract commitments,and PURPA contracts that have terminated or expired.Id.
NOTICE OF APPLICATION
YOU ARE HEREBY NOTIFIED that the Company's Application provides Commission
Ordered updates to its load forecast,natural gas forecast,and contract information.The Company
explains that if the Commission approves the updates,the Company will incorporate them into its
IRP avoided cost model and use the model to negotiatecontractual avoided cost rates as of October
15,2019.Application at 2.
YOU ARE FURTHER NOTIFIED that the Company's updated load forecast is from July
2019 and "shows a slight increase in load compared to the July 2018 load forecast provided in
Case No.PAC-E-18-09 and approved by the Commission in Order No.34213."Id.at 3.The
Company provides both the July 2019 and the July 2018 load forecasts for years 2019 through
2039.Id.at 5;See Table 1.
YOU ARE FURTHER NOTIFIED that the Company's updated natural gas forecast was
prepared on September 30,2019 using the Official Forward Price Curve ("OFPC")as reference,
which indicates a slight decrease in the average natural gas forecast prices over the next 20 years
compared to the September 28,2018 OFPC.Id.at 3.The Company provides both the 2019 and
the 2018 forecasts for years 20192 through 2038.Id.at 6;See Table 2.
'See Order No.33785 (regarding battery storage facilities).
2 The OFPC provided in the Company's Application forecasts 2019 gas prices for November and Decemberonly.
NOTICE OF APPLICATION
NOTICE OF MODIFIED PROCEDURE
ORDER NO.34496 2
YOU ARE FURTHER NOTIFIED that,regarding contract additions and terminations,the
Company explains that it has signed 19 long-term contracts,15 of which are with QFs,for a total
nameplate capacity of 680.8 megawatts ("MW").Id.at 3.Four long-term contracts,with a
combined nameplate capacity of 57.4 MW,have terminated.Id.The Company provides a list of
the contract additions and terminations in its Application.See Table 3.The Company indicates it
continuouslyincludes new power purchase agreements,terminated or expired contracts,and new
contract pricing in its avoided cost IRP model.Id.at 4.
YOU ARE FURTHER NOTIFIED that the Company's Application has been filed with the
Commission and is available for public inspection during regular business hours at the
Commission's office.The Application is also available on the Commission's Website at
wwww.idaho.cov under "File Room"and then "Electric Cases."
YOU ARE FURTHER NOTIFIED that all proceedings in this case will be held pursuant
to the Commission's jurisdiction under Title 61 of the Idaho Code,and specificallyIdaho Code §
61-503.The Commission may enter any final order consistent with its authorityunder Title 61.
YOU ARE FURTHER NOTIFIED that all proceedings in this matter will be conducted
pursuant to the Commission's Rules of Procedure,IDAPA 31.01.01.000,et seq.
NOTICE OF MODIFIED PROCEDURE
YOU ARE FURTHER NOTIFIED that the Commission has determined that the public
interest may not require a formal hearingin this matter and will proceed under Modified Procedure
pursuant to Rules 201 through 204 of the Idaho Public Utilities Commission's Rules of Procedure,
IDAPA 31.01.01.201-.204.The Commission notes that Modified Procedure and written comments
have proven to be an effective means for obtaining public input and participation.
YOU ARE FURTHER NOTIFIED that any person desiring to state a position on the
Company's Application may file a written comment in support or opposition with the
Commission by December 17,2019.The comment must contain a statement of reasons
supporting the comment.Persons desiring a hearing must specifically request a hearing in their
written comments.Written comments concerning this filingmay be mailed to the Commission and
the Company at the addresses reflected below:
NOTICE OF APPLICATION
NOTICE OF MODIFIED PROCEDURE
ORDER NO.34496 3
For Idaho PUC:For Rocky Mountain Power:
Commission Secretary Ted Weston
Idaho Public Utilities Commission Daniel Solander
PO Box 83720 1407 West North Temple,Suite 330
Boise,ID 83720-0074 Salt Lake City,UT 84116
E-mail:[e-mail]
Street Address for Express Mail:[e-mail]
[e-mail]
11331 W.Chinden Blvd.
Building 8,Suite 201-A Data Request Response Center
Boise,ID 83714 PacifiCorp
825 Multnomah,Suite 2000
Portland,OR 97232
These comments should contain the case caption and case number shown on the first page of this
document.Persons desiring to submit comments via e-mail may do so by accessing the
Commission's home page located at www.puc.idabosov.Click the "Case Comment or Question
Form"under the "Consumers"tab,and complete the form using the case number as it appears on
the front of this document.
YOU ARE FURTHER NOTIFIED that the Company shall file reply comments,if
necessary,by December 24,2019.
YOU ARE FURTHER NOTIFIED that if no written comments or protests are received
within the time limit set,the Commission will consider this matter on its merits and enter its order
without a formal hearing.If written comments are received within the time limit set,the
Commission will consider them and,in its discretion,may set the same for formal hearing.
ORDER
IT IS HEREBY ORDERED that the Company's Application be processed under Modified
Procedure,Rules 201-204 (IDAPA 31.01.01.201-.204).Persons interested in submitting written
comments must do so by December 17,2019.The Company must file any reply comments by
December 24,2019.
NOTICE OF APPLICATION
NOTICE OF MODIFIED PROCEDURE
ORDER NO.34496 4
DONE by Order of the Idaho Public Utilities Commission at Boise,Idaho this à
day of December 2019.
PAUL KJELLAN ,RESIDENT
KRIS E RAPER,COMMI SIONER
ERIC ANDERSON,COMMISSIONER
ATTEST:
Diane M.Hanian
Commission Secretary
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NOTICE OF APPLICATION
NOTICE OF MODIFIED PROCEDURE
ORDER NO.34496 5